Dental vs. Medical Insurance

A participant asked:  I have attended your courses and you explained dental insurance as being different than other kinds of insurance and described dentistry as somewhat of a cottage industry. What makes dental insurance so different?

Patti responded: What I mean by cottage industry comes from the old days of businesses from the home. Dentistry has been a cottage industry of loosely organized independent practitioners. DSO’s and group practices are changing that model.

  • Insurance: This very common used term is defined as coverage by contract whereby one party undertakes to indemnify or guarantee another against loss by a specified contingency or peril. Dental benefits whether private or public does not fit this definition of traditional insurance.
  • 3rd Party Reimbursement: Payment made by a third party to a beneficiary or to a dental practitioner on behalf of the beneficiary, to offset expenses incurred for a service covered by the dental benefit plan. As noted, this is NOT the same as traditional insurance. At best, for communication purposes, a patient’s benefits are more akin to a discount coupon rather than to cover a loss.

I use the analogy for dental benefits being like a coupon or Kohl’s bucks. There is a limited amount with lots of small print for exceptions. At the same time, even if I am going to buy a Coach purse and I have a $50 off coupon, I am going to want to use. Particularly, if that coupon was given to me in lieu of salary.

That is, of course, very different than medical coverage. Medical plans might have some limitations etc. yet there cap for payment is not $1000-$1500 as dental benefits have been for 40+ years.

Understanding and being able to explain this difference is key to patient communications. More details are available though the Learning Center Course 101: Learning the Language. 

 

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